The Now-Dead File and Suspend Social Security Strategy

Due to Social Security rules that became law in November 2015, the file and suspend strategy is no longer available for couples. It worked for those who suspended benefits on or before April 30, 2016. Now, you can still suspend benefits, but your spouse can't receive a spousal benefit while your benefits are in suspension.

The File and Suspend Strategy

The file and suspend strategy allowed your spouse to collect a spousal benefit based on your earnings record while you delayed the start of your own benefits, thus maximizing your own benefit by accumulating delayed retirement credits. This strategy worked if you attained your full retirement age and suspended benefits prior to April 30, 2016.

Benefits of the Strategy

Your spouse can't collect a spousal benefit based on your earning’s record until you've applied for your own Social Security retirement benefit. By suspending your benefits, you enabled your spouse to collect a spousal benefit while your own Social Security benefits accumulated delayed retirement credits (which are applied up until your age 70). 

Suspending benefits means you file for Social Security and then immediately stop your benefits. Up until April 30, 2016, you were able to do this, and stopping your own benefits had no effect on any dependent benefits. After April 30, 2016, when you suspend your own benefits, it also suspends any spousal benefits that are payable. So you can still suspend benefits, but now it will also have the impact of suspending any other benefits dependent on your earnings record.

Guidance for Suspending Benefits

If you file benefits early and end up continuing to work, you can still suspend benefits. It may make a lot of sense to do this, because later, when you restart benefits, you'll get more. There is no reason, however, to suspend benefits past age 70. You definitely want to start Social Security on your 70th birthday month.

If you are the higher earner, you should strongly consider delaying the start of your own benefits to age 70. Doing this will result in a higher survivor benefit for either one of you. This is still the case, even with the new rules.

If you are a widow or widower, you also still have several claiming options. For example, you can claim a widow benefit as early as age 60, then switch to your own benefit at age 70, or claim your own benefit at age 62, and switch to the widow benefit at your full retirement age. One option is likely to result in more income over your lifetime than another, which is why you need to evaluate both choices before you start benefits.

Your best option is to use a Social Security calculator to tell you what claiming strategy might work best for you. These online calculators have the various date of birth rules programmed into their calculations, so they can quickly evaluate what claiming option will provide you with the most income over your lifetime.

Many people are worried about running out of money in old age. To help protect yourself against this outcome, consider working longer and starting your benefits at age 70. That higher guaranteed paycheck will provide you great comfort in your later years.